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Netflix Negotiates 2015 Spain Launch

Internet SVOD giant faces weighty competitors in Telefonica, Canal Plus

MADRID – Adding another major territory to its European rollout agenda, Netflix looks to be negotiating for a second-half bow in Spain in either late summer or fall.

Per one source, Netflix has already closed deals with Hollywood major studios for Spanish rights with a start-date for product of Sept. 1.

Citing “diverse sector sources,” Expansion, a Spanish financial daily newspaper, claimed Saturday that Netflix is negotiating with Hollywood majors and independent distributors with an eye to launching in Spain in the last quarter of 2015. Expansion also cites sources close to television manufacturer LG confirming that its smart TVs will carry Netflix beginning in September. Samsung also told the same newspaper that it’s smart TVs will be Netflix-compatible this year.

Other sources are more cautious, suggesting that there are talks, but no Netflix studio deal is as yet in place for Spain.

A Netflix spokesperson declined to comment, apart from pointing to the company’s announcement – when revealing fourth-quarter results this January – that it planned to complete global expansion by the end of next year.

Certainly, a Spain launch would be in line with Netflix’s ambitious announcement this January that it aims to roll out its footprint to 200 countries in the space of two years, while maintaining profitability.

Netflix has come very close to a Spain launch before, visiting Spain in June 2011, and offering Spanish distributors contracts for content at sky-high prices. But Netflix pulled back, reportedly because of Spain’s high piracy levels.

Since last year, when Spain was left out of Netflix’s launch in six new European countries, at least two factors have changed, however.

Spain emerged from recession in late summer 2013 and saw 1.4% GDP growth in 2014 as consumer spending rebounded, exceeding analysts’ expectations.

Last March, telco giant Telefonica bought Spanish paybox Canal Plus in a $1.4 billion deal that still has to be approved by Spanish anti-trust authorities.

Adding 1.2 million net new pay TV subs in 2014, Telefonica now has 1.9 million customers and a 35% pay TV market share in Spain. Last December, Telefonica launched Movistar Series, a HD SVOD series service that has moved energetically to acquire series and market them to the public, announcing last month an eight-title deal with CBS Studios Intl. thar takes in “The Affair,” “Madam Secretary” and “Penny Dreadful,” and moving into original Spanish productions. It would also be logical for Spain’s Vodafone-ONO, with 784,000 TV subs year-end 2014, to drive harder into original content in order to face off with Telefonica. If Netflix waits any longer, other players — Movistar, Canal Plus’ Yomvi, Vodafone-ONO —  could corner Spain’s SVOD market.

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